Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698931933264.pdf (New Zealand)
Takeovers Amendment Act 2006 Public Act Date of assent 2006 No 48 24 October 2006 Contents Title Commencement Principal Act amended Interpretation Object of this Act Delegation of certain powers by Panel New section 15B inserted 15B Sharing of information with Commerce Commission New heading inserted New sections 31L to 31MA substituted 31L Who may receive evidence 31M Admissibility of evidence 31MA How evidence may be given Power to summon witnesses Panel’s powers in respect of compliance with takeovers code Restraining orders New section 33AA inserted 33AA Permanent compliance orders New section 33C substituted 33C Restrictions on use of self­incriminating statements obtained by summons Page 5 5 5 5 7 7 7 7 7 8 8 8 8 9 9 10 10 11 11 11 1 Takeovers Amendment Act 2006 2006 No 48 15 16 Heading above section 33E and sections 33E and 34 repealed New subpart 2 inserted Subpart 2—Enforcement by Court Overview of enforcement powers and civil remedies 33E Overview of enforcement powers and civil remedies Injunctions 33F What Court may injunct 33G When Court may grant injunctions and interim injunctions Undertaking as to damages not required by Panel Various civil remedy orders When Court may make various civil remedy orders Terms of various civil remedy orders 33H 33I 33J Compensatory orders 33K When Court may make compensatory orders 33L Terms of compensatory orders Pecuniary penalty orders and declarations of contravention 33M When Court may make pecuniary penalty orders 33N and declarations of contravention Purpose and effect of declarations of contravention 33O What declarations of contravention must state 33P Maximum amount of pecuniary penalty 33Q Considerations for Court in determining pecuniary penalty Court must order that recovery from pecuniary penalty be applied to Panel’s actual costs 33R General Persons who may apply Sections 36 and 37 repealed Court may have regard to determinations and recommendations by Panel Sections 39 and 40 repealed 17 18 19 20 2 12 12 12 13 13 13 14
 14 15 15 16 17 17 17 18 18 18 19 19 19 2006 No 48 Takeovers Amendment Act 2006 21 22 23 24 Court may excuse contravention New section 41 substituted 41 Court may require person to give evidence or produce documents relating to interests in securities New sections 43 to 43C substituted 43 More than 1 civil remedy order may be made for same conduct Only 1 pecuniary penalty order may be made for same conduct Standard of proof for civil remedies 43B 43C Time limit for applying for civil remedies New heading and subparts 3, 4, and 5 substituted 43A Subpart 3—Offences General offences 44 44A 44B 44C 44D 44E General offences Conviction of offence under section 44 excluded in certain cases False or misleading statement or information False or misleading statement or information Criminal liability for false or misleading statement or information Exception for disclosure by investment advisers or brokers Fair Trading Act 1986 excluded Subpart 4—Other Court orders Management bans 44F When Court may make management banning orders Terms of management banning orders Offence of contravening management banning order Only one management banning order may be made for same conduct Persons automatically banned from management General provisions for bans and banning orders 44G 44H 44I 44J 44K Orders to preserve assets to satisfy claims 44L When Court may prohibit payment or transfer of money, securities, or other property 44M What orders may be made 19 19 19 20 20 20 20 20 21 21 22 22 23 23 23 23 24 24 25 25 25 26 27 3 Takeovers Amendment Act 2006 2006 No 48 44N 44O 44P Interim orders Relationship with other law Offence Subpart 5—General Jurisdiction of Courts in New Zealand 44Q Court may order payment of Panel’s costs 44R Orders to secure compliance 44S Giving notice of applications for Court orders 44T General provisions as to Court’s orders 44U 44V Persons entitled to appear before Court 44W Knowledge of matters presumed if employee or agent knows matters No pecuniary penalty and ﬁne
 for same conduct 44X New Part 4 heading substituted Part4 Miscellaneous Amendments to takeovers code Takeovers code substituted Interpretation Offer period New Part 8 added Part8 Market manipulation 64 65 Misleading or deceptive conduct Exception for disclosure by investment advisers or brokers Amendments to replace references to takeovers schemes Amendments to replace references to takeovers schemes Transitional provisions Transitional provision for acquisitions made or committed to before commencement of this section Transitional provision for existing offences and contraventions (3) 3 4 (1) 2006 No 48 Takeovers Amendment Act 2006 s 4 The Parliament of New Zealand enacts as follows: 1 2 (1) Title This Act is the Takeovers Amendment Act 2006.
Commencement This Act comes into force on the day after the date on which it receives the Royal assent.

(2) However, the following provisions only come into force on a date to be appointed by the Governor­General by Order in Council: (a) new sections 44B, 44C, 44D, and 44E of the Takeovers Act 1993 as inserted by section 24: section 29.

(b) For the purposes of subsection (2), 1 or more orders may be made bringing different provisions into force on different dates.
Principal Act amended Sections 4 to 25 amend the Takeovers Act 1993.

Interpretation The deﬁnition of company in section 2(1) is repealed and the following deﬁnition substituted: “company has the same meaning as in section 2(1) of the Companies Act 1993”.
(2) The deﬁnition of speciﬁed company in section 2(1) is re­ pealed and the following deﬁnition substituted: “speciﬁed company means a company that— “(a) is a party to a listing agreement with a registered exchange and that has securities that confer voting rights quoted on the registered exchange’s market; or “(b) was within paragraph (a) at any time during a period speciﬁed in the takeovers code (being a period not exceeding 12 months before any date or the occurrence of any event referred to in the code); or has 50 or more shareholders”.
“(c) 5 s 4 (3) Takeovers Amendment Act 2006 2006 No 48 Section 2(1) is amended by inserting the following deﬁnitions in their appropriate alphabetical order: “quoted, in relation to securities of a person, means securities of the person that are approved for trading on a registered exchange’s market (and, for the avoidance of doubt, securities do not cease to be quoted merely because trading in those securities is suspended) “voting right means a currently exercisable right to cast a vote at meetings of shareholders of a company, not being a right to vote that is exercisable only in 1 or more of the following circumstances “(a) during a period in which a payment or distribution (or part of a payment or distribution) in respect of the security that confers the voting right is in arrears or some other default exists: “(b) on a proposal that affects rights attached to the security that confers the voting right: on a proposal to put the company into liquidation: “(c) “(d) on a proposal for the disposal of the whole, or a material part, of the property, business, and undertaking of the company: during the liquidation of the company: in respect of a special, immaterial, or remote matter that is inconsequential to control of the company.” The deﬁnition of public issuer in section 2 is repealed.
Section 2 is amended by adding the following subsection: In sections 32, 33, and 33AA and in subpart 2 of Part 3 (which contain the enforcement powers of the Panel and the Court), unless the context otherwise requires, contravene the takeovers code or not act in compliance with the takeovers code includes— “(a) a contravention of the takeovers code or a term or con­ dition of an exemption from the takeovers code; or an attempt to contravene the takeovers code or a term or condition of an exemption from the takeovers code; or aiding, abetting, counselling, or procuring any other person to contravene the takeovers code or a term or condition of an exemption from the takeovers code; or inducing, or attempting to induce, any other person, whether by threats or promises or otherwise, to contra­ vene the takeovers code or a term or condition of an exemption from the takeovers code; or “(b) “(c) “(d) “(e) “(f) (4) (5) “(2) 6 2006 No 48 Takeovers Amendment Act 2006 s 8 “(e) “(f) being in any way, directly or indirectly, knowingly con­ cerned in, or a party to, the contravention by any other person of the takeovers code or a term or condition of an exemption from the takeovers code; or conspiring with any other person to contravene the takeovers code or a term or condition of an exemption from the takeovers code.” 5 Object of this Act Section 4 is amended by inserting the following paragraph af­ ter paragraph (c): “(ca) provide criminal liability for false or misleading statements or information in relation to takeovers of speciﬁed companies:”.
6 Delegation of certain powers by Panel Section 14(1) is amended by inserting “31A,” after “sections”.
7 New section 15B inserted The following section is inserted after section 15A: “15B Sharing of information with Commerce Commission “(1) The Panel may communicate to the Commerce Commission any information that the Panel— “(a) “(b) holds in relation to the exercise of the Panel’s powers, or the performance of its functions and duties; and considers may assist the Commerce Commission in the exercise of the Commerce Commission’s powers, or the performance of its functions and duties, in respect of the Fair Trading Act 1986.
“(2) The Panel may use any information communicated to it by the Commerce Commission under section 48A of the Fair Trading Act 1986 in the Panel’s exercise of its powers, or the perform­ ance of its functions and duties.

“(3) This section applies despite anything to the contrary in any enactment, contract, deed, or document.” 8 New heading inserted The heading “Subpart 1—Investigation and enforcement by Panel” is inserted after the Part 3 heading.
7 s 9 9 Takeovers Amendment Act 2006 2006 No 48 New sections 31L to 31MA substituted Sections 31L and 31M are repealed and the following sections substituted: “31L Who may receive evidence “(1) The Panel may receive evidence through a member, ofﬁcer, or employee of the Panel, or any 2 or more of them.
“(2) However, if a person who is summoned to give evidence under section 31N requests that the evidence be received at a meeting of the Panel, then— “(a) subsection (1) does not apply, and the evidence must be received at a meeting of the Panel; and the meeting must not be held by a method under clause 8(b) of Schedule 5 of the Crown Entities Act 2004 ex­ cept with the consent of the person summoned.
“(b) “31M Admissibility of evidence The Panel may receive in evidence, whether admissible in a court of law or not, any statement, document, information, or matter that,— “(a) in the opinion of the person receiving it, may assist the Panel in dealing effectively with any matter before it; or the Panel may receive under section 31P.
“(b) “31MA How evidence may be given “(1) The Panel may receive evidence— given on oath: “(a) “(b) given not on oath: “(c) if the person receiving the evidence permits it, given by a written statement: if the person receiving the evidence thinks it is appro­ priate, given by a written statement veriﬁed on oath: given by audio­visual communication, if the Panel and the person giving the evidence agree.
“(d) “(e) “(2) A member, ofﬁcer, or an employee of the Panel may administer an oath for the purpose of a person giving evidence on oath.” 8 2006 No 48 Takeovers Amendment Act 2006 s 11 10 (1) Power to summon witnesses Section 31N is amended by repealing subsection (1) and sub­ stituting the following subsection: “(1) A member of the Panel may issue a summons to a person re­ quiring that person to appear (in the case of a body corporate, to appear by its authorised representative) before the Panel, or a member, ofﬁcer, or employee of the Panel, in relation to any matter before the Panel and to do any of the following things: “(a) “(b) give evidence under oath: “(c) provide any documents or information that are in the person’s possession or control and that are relevant to the matter.” give evidence: (2) (3) Section 31N(2)(c) is amended by omitting “he or she” and substituting “the person”.
Section 31N is amended by repealing subsection (3) and sub­ stituting the following subsection: “(3) A summons may be served,— “(a) “(b) in the case of a natural person, by delivering it person­ ally to the person summoned or by leaving it at his or her usual place of residence or business at least 24 hours before his or her attendance is required: in the case of a body corporate, by leaving it at the body corporate’s usual place of business at least 24 hours be­ fore its attendance is required.” 11 (1) (2) Panel’s powers in respect of compliance with takeovers code Section 32(2) is amended by inserting “temporary” before “re­ straining”.
Section 32 is amended by inserting the following subsection after subsection (3): “(3A) If the Panel makes a determination under subsection (3), the Panel must, as soon as reasonably practicable, give written notice of its reasons for the determination to the person the determination concerns.” Section 32(4) is amended by inserting “temporary” before “re­ straining” wherever it occurs.
(3) 9 s 12 Takeovers Amendment Act 2006 2006 No 48 Section 32(4) is amended by adding the following paragraphs: (4) “(c) make a permanent compliance order (relating to the non­com­ “(d) (5) pliance with the takeovers code): if it makes any order under this subsection, also make an order extending, for a reasonable time, the period for which a takeover offer must remain open.” Section 32 is amended by inserting the following subsection after subsection (4): “(4A) If the Panel makes an order under this section, the Panel— “(a) must immediately give written notice to the person to whom the order is directed of the terms and conditions of the order; and “(b) must, as soon as is reasonably practicable, also give that person written notice of the reasons for the order; and “(c) may also give notice to any other person of those mat­ ters.” (6) (7) 12 (1) (2) (3) “(d) Section 32(5) is amended by omitting “A restraining order” and substituting “An order”.
Section 32(6) and (7) is amended by omitting “restraining” in each place where it occurs.

Restraining orders The heading to section 33 is amended by omitting “Restrain­ ing” and substituting “Temporary restraining”.

Section 33 is amended by inserting “temporary” before “re­ straining” in the ﬁrst place where it appears.
Section 33 is amended by repealing paragraph (d) and substi­ tuting the following paragraph: restraining a person from taking any action (including from making any statement or distributing any document) that is or that may reasonably be expected to constitute a contravention of the takeovers code (see section 2(2) for the deﬁnition of contravention of the takeovers code):”.
13 New section 33AA inserted The following section is inserted after section 33: 10 2006 No 48 Takeovers Amendment Act 2006 s 14 “33AA Permanent compliance orders For the purposes of section 32, a permanent compliance order is an order for one or more of the following: “(a) prohibiting or restricting a person from making any statement or distributing any document that is or that may reasonably be expected to constitute a contra­ vention of the takeovers code (see section 2(2) for the deﬁnition of contravention of the takeovers code): “(b) directing a person to disclose in accordance with the order information for the purpose of securing compli­ ance with the takeovers code: directing a person to publish, at the person’s own ex­ pense, in the manner and at the times speciﬁed in the order corrective statements that are speciﬁed in, or are to be determined in accordance with, the order: for the purpose of securing compliance with any of those orders, an order directing a person to do or refrain from doing a speciﬁed act.” “(d) “(c) 14 New section 33C substituted Section 33C is repealed and following section substituted: “33C Restrictions on use of self­incriminating statements obtained by summons “(1) A self­incriminating statement made orally by a person sum­ moned under section 31N (whether or not the statement is recorded in writing) in the course of answering any question before, or providing any information or document to, the Panel, or a member, ofﬁcer, or employee of the Panel,— “(a) subject to paragraph (b), is not admissible in— criminal proceedings against that person; or “(i) “(ii) proceedings under this Act, the Securities Act 1978, or the Securities Markets Act 1988 for a pecuniary penalty order against that person; but is admissible against that person in any proceeding in respect of the falsity of the person’s testimony, for ex­ ample, in a prosecution for perjury or for an offence under section 44(1).
“(b) “(2) In addition,— 11 s 15 Takeovers Amendment Act 2006 2006 No 48 “(a) “(b) a refusal or failure to answer a question or provide in­ formation or a document or comply with any other re­ quirement may be used in evidence against that person in proceedings for an offence under section 44(1) aris­ ing from that refusal or failure; and the answering of a question in a way that is false, decep­ tive, or misleading or the providing of information or a document that is false, deceptive, or misleading may be used in evidence against that person in proceedings for an offence under section 44(1) arising from that act.” 15 Heading above section 33E and sections 33E and 34 repealed The heading above section 33E and sections 33E and 34 are repealed.
16 New subpart 2 inserted The following subpart is inserted before section 35: “Subpart 2—Enforcement by Court “Overview of enforcement powers and civil remedies “33E Overview of enforcement powers and civil remedies “(1) The following enforcement orders and remedies (civil remedy orders) are available under this subpart for a contravention of the takeovers code: an injunction: “(a) a civil remedy order under section 33I: “(b) a compensatory order: “(c) a pecuniary penalty order and declaration of contraven­ “(d) tion (on application by the Panel only).
“(2) See section 2(2) for the deﬁnition of contravention of the takeovers code in this subpart.

“(3) This section is a guide only to the general scheme and effect of this subpart.

12 2006 No 48 Takeovers Amendment Act 2006 s 16 “33F What Court may injunct “Injunctions The Court may, on application by any person in accordance with section 35, grant an injunction restraining a person from engaging in conduct that constitutes or would constitute a contravention of the takeovers code.
“33G When Court may grant injunctions and interim injunctions “(1) The Court may grant an injunction restraining a person from engaging in conduct of a particular kind if— “(a) it is satisﬁed that the person has engaged in conduct of that kind; or it appears to the Court that, if an injunction is not granted, it is likely that the person will engage in con­ duct of that kind.
“(b) “(2) The Court may grant an interim injunction restraining a person from engaging in conduct of a particular kind if in its opinion it is desirable to do so.

“(3) Subsections (1)(a) and (2) apply whether or not it appears to the Court that the person intends to engage again, or to con­ tinue to engage, in conduct of that kind.
“(4) Subsections (1)(b) and (2) apply whether or not— “(a) “(b) the person has previously engaged in conduct of that kind: there is an imminent danger of substantial damage to any other person if that person engages in conduct of that kind.
“33H Undertaking as to damages not required by Panel “(1) If the Panel applies to the Court for the grant of an interim in­ junction under this subpart, the Court must not, as a condition of granting an interim injunction, require the Panel to give an undertaking as to damages.

“(2) However, in determining the Panel’s application for the grant of an interim injunction, the Court must not take into account that the Panel is not required to give an undertaking as to dam­ ages.
13 s 16 Takeovers Amendment Act 2006 2006 No 48 “Various civil remedy orders “33I When Court may make various civil remedy orders The Court may, on application by any person in accordance with section 35, make 1 or more of the civil remedy orders described in section 33J if the Court is satisﬁed on reasonable grounds that a person has contravened or is contravening or intends to contravene the takeovers code.
“33J Terms of various civil remedy orders “(c) “(b) A civil remedy order under section 33I may— “(a) restrain the exercise of rights attaching to securities or declare an exercise of those rights to be void and of no effect: restrain the issue or allotment of securities or restrain any distribution due in relation to securities: restrain the acquisition or disposal of securities or of interests in or rights relating to them or restrain the registration of any transfer or transmission of securities: “(d) direct the disposal of securities or of interests in or rights relating to them (including the person or class of per­ sons to which they must, or must not, be disposed of) and direct the payment of the proceeds of any disposal: require securities to be forfeited and require the public issuer to cancel the forfeited securities: cancel an agreement for the acquisition or disposal of securities or interests in or rights relating to them: “(g) vest securities or interests in or rights relating to them in a trustee for sale on the terms and conditions the Court thinks ﬁt: “(e) “(f) “(i) “(h) declare an agreement for the acquisition of securities or interests in or rights relating to them to be voidable at the option of the person from whom the securities or interests or rights were acquired: if a contract is entered into in contravention of the takeovers code, or a contract contains a provision which, to, would contravene the takeovers code,— “(i) vary the contract, in such manner as the Court thinks ﬁt: if given effect 14 2006 No 48 Takeovers Amendment Act 2006 s 16 cancel the contract: “(ii) “(iii) require any person who is a party to the contract to make restitution or pay compensation to any other person who is a party to the contract: prohibit or restrict a person from making any statement or distributing any document that is or that may rea­ sonably be expected to constitute a contravention of the takeovers code: “(j) “(l) “(k) direct a person to disclose in accordance with the order information for the purpose of securing compliance with the takeovers code even though the time for doing so may have expired: direct a person to publish, at the person’s own expense, in the manner and at the times speciﬁed in the order corrective statements that are speciﬁed in, or are to be determined in accordance with, the order: require a person to comply with any provision of the takeovers code even though the time for doing so may have expired.
“(m) “Compensatory orders “33K When Court may make compensatory orders “(1) The Court may make a compensatory order, on application by any person in accordance with section 35, if the Court is satisﬁed that— “(a) “(b) there is a contravention of the takeovers code; and a person (the aggrieved person) has suffered, or is likely to suffer, loss or damage because of the contra­ vention.

“(2) The Court may make a compensatory order whether or not the aggrieved person is a party to the proceedings.
“33L Terms of compensatory orders If section 33K applies, the Court may make any order it thinks just to compensate an aggrieved person in whole or in part for the loss or damage, or to prevent or reduce that loss or damage, including an order (without limitation) to— 15 s 16 Takeovers Amendment Act 2006 2006 No 48 “(a) direct the person in contravention to pay to the ag­ grieved person the amount of the loss or damage: “(b) direct the person in contravention to refund money or “(c) return property to the aggrieved person: if a contract has been entered into between the person in contravention and the aggrieved person,— “(i) vary the contract or any collateral arrangement as speciﬁed in the order and, if the Court thinks ﬁt, declare the contract or arrangement to have had effect as so varied on and after a date before the order was made, as speciﬁed in the order: cancel the contract and, if the Court thinks ﬁt, de­ clare the cancellation to have had effect on and after a date before the order was made, as speci­ ﬁed in the order: “(ii) “(iii) require the person in contravention to take any action the Court thinks ﬁt to reinstate the parties as near as may be possible to their former pos­ itions.
“Pecuniary penalty orders and declarations of contravention “33M When Court may make pecuniary penalty orders and declarations of contravention If the Panel applies for a pecuniary penalty order against a per­ son under this Act in accordance with section 35, the Court— “(a) must determine whether the person has contravened the takeovers code; and “(b) must make a declaration of contravention (see sections 33N and 33O) if satisﬁed that the person has contra­ vened the takeovers code; and “(c) may order the person to pay a pecuniary penalty that the Court considers appropriate to the Crown (see sections 33P and 33Q) if satisﬁed that the person has contravened the takeovers code, that the person knew or ought to have known of the conduct that constituted the contravention, and that the contravention— “(i) materially prejudices the interests of offerees, the speciﬁed company, the offeror or acquirer, com­ 16 2006 No 48 Takeovers Amendment Act 2006 s 16 peting offerors, or any other person involved in or affected by a transaction or event that is or will be regulated by the takeovers code, or that is in­ cidental or preliminary to a transaction or event of that kind; or is likely to materially damage the integrity or reputation of any of New Zealand’s securities markets; or “(ii) “(iii) is otherwise serious.
“33N Purpose and effect of declarations of contravention “(1) The purpose of a declaration of contravention is to enable an applicant for a civil remedy order under section 33I or a com­ pensatory order under section 33K to rely on the declaration of contravention in the proceedings for that order, and not be required to prove the contravention.

“(2) Accordingly, a declaration of contravention is conclusive evi­ dence of the matters that must be stated in it under section 33O.
“33O What declarations of contravention must state A declaration of contravention must state the following: “(a) “(b) the court that made the declaration; and the provision of the takeovers code to which the contra­ vention relates or, if the contravention is of an exemp­ tion, both the term or condition contravened and the takeovers code provision to which the exemption re­ lates; and the person in contravention; and the conduct that constituted the contravention and, if a transaction constituted the contravention, the transac­ tion; and the speciﬁed company to which the conduct related.
“(c) “(d) “(e) “33P Maximum amount of pecuniary penalty The maximum amount of a pecuniary penalty is $500,000 for an individual and $5,000,000 for a body corporate, for each contravention.
17 s 17 Takeovers Amendment Act 2006 2006 No 48 “33Q Considerations for Court in determining pecuniary penalty In determining an appropriate pecuniary penalty, the Court must have regard to all relevant matters, including— “(a) “(b) “(c) the principles contained in the takeovers code; and the nature and extent of the contravention; and the likelihood, nature, and extent of any damage to the integrity or reputation of any of New Zealand’s secur­ ities markets because of the contravention; and the nature and extent of any loss or damage suffered by a person referred to in section 33M(c)(i) because of the contravention; and the circumstances in which the contravention took place; and “(d) “(e) “(f) whether or not the person in contravention has previ­ ously been found by the Court in proceedings under this Act to have engaged in any similar conduct.
“33R Court must order that recovery from pecuniary penalty be applied to Panel’s actual costs If the Court orders that a person pay a pecuniary penalty, and the proceedings were brought (in whole or in part) by the Panel, the Court must also order that the penalty must be ap­ plied ﬁrst to pay the Panel’s actual costs in bringing the pro­ ceedings.

“General”.

Persons who may apply Section 35(1) is amended by omitting “section 34 of this Act” and substituting “section 33F, 33I, or 33K”.
Section 35(3) is amended by omitting “section 34 of this Act” and substituting “section 33F, 33I, or 33K”.
Section 35 is amended by repealing subsection (4) and substi­ tuting the following subsection: If the Panel makes a determination under section 32(3)(b) (a determination that the Panel is not satisﬁed that a person has acted or is acting or intends to act in compliance with the 17 (1) (2) (3) “(4) 18 2006 No 48 Takeovers Amendment Act 2006 s 22 takeovers code), the Panel may make an application to the Court under section 33M.” 18 19 (1) (2) 20 21 Sections 36 and 37 repealed Sections 36 and 37 are repealed.
Court may have regard to determinations and recommendations by Panel Section 38(1) is amended by omitting “section 34 of this Act” and substituting “this subpart”.

Section 38(2) is amended by omitting “section 36 of this Act” and substituting “section 33I or 33K”.

Sections 39 and 40 repealed Sections 39 and 40 are repealed.
New section 41 substituted Section 41 is repealed and the following section substituted: “41 Court may excuse contravention “(1) If the Court is satisﬁed that a person has, by any act or omis­ sion, contravened the takeovers code, but that the contraven­ tion ought to be excused, the Court may (by order) declare that the act or omission was not a contravention of the code.
In considering whether the contravention should be excused, the Court may have regard to— “(a) inadvertence or mistake on the part of the person con­ cerned: “(2) “(b) whether the person was aware of a relevant factor or circumstance: circumstances beyond that person’s control: any other matters that the Court thinks ﬁt.
“(c) “(d) “(3) The order has effect according to its tenor.” 22 (1) Court may require person to give evidence or produce documents relating to interests in securities Section 42(1) is amended by omitting “section 34 of this Act” and substituting “this subpart”.

19 s 23 (2) 23 Takeovers Amendment Act 2006 2006 No 48 Section 42(2) is amended by omitting “section 34 of this Act” and substituting “this subpart”.
New sections 43 to 43C substituted Section 43 is repealed and the following sections substituted: “43 More than 1 civil remedy order may be made for same conduct The Court may make a civil remedy order of one kind against a person even though the Court has made another civil remedy order of a different kind against the person for the same con­ duct.

Examples The Court may make a compensatory order and a pecuniary penalty order for the same conduct.
The Court may make a civil remedy order requiring forfeiture of secur­ ities and declaring a previous exercise of voting rights attaching to those securities to be void.
“43A Only 1 pecuniary penalty order may be made for same conduct If conduct by a person constitutes a contravention of 2 or more provisions of the takeovers code, proceedings may be brought against that person for the contravention of any one or more of the provisions, but no person is liable to more than one pecuniary penalty order for the same conduct.
“43B Standard of proof for civil remedies The proceedings under this subpart are civil proceedings and the usual rules of the Court and rules of evidence and pro­ cedure for civil proceedings apply (including the standard of proof).
“43C Time limit for applying for civil remedies “(1) An application for a civil remedy order under section 33I or a pecuniary penalty order under section 33M may be made at any time within 2 years after the date on which the matter giving rise to the contravention was discovered or ought rea­ sonably to have been discovered.

20 2006 No 48 Takeovers Amendment Act 2006 s 24 “(2) The usual time limits apply to all applications for other civil remedy orders.
“(3) However, an application for a compensatory order in respect of a contravention may be made at any time within 6 months after the date on which a declaration of contravention is made, even if the usual time limit has expired.” 24 New heading and subparts 3, 4, and 5 substituted Section 44 is repealed and the following heading and subparts substituted: “Subpart 3—Offences “General offences “44 General offences “(1) A person must not— “(a) “(b) furnish information, produce a document, or give evi­ dence to the Panel or a member, ofﬁcer, or employee of the Panel knowing it to be false or misleading; or attempt to deceive or knowingly mislead the Panel or a member, ofﬁcer, or employee of the Panel in relation to any matter before it.
“(2) A person who has been summoned to appear before the Panel or a member, ofﬁcer, or employee of the Panel must not, with­ out reasonable excuse,— “(a) refuse or fail to appear before the Panel to give evi­ dence: refuse to take an oath or afﬁrmation as a witness: refuse to answer any question: refuse or fail to provide any document or information that the person is required to provide.
“(b) “(c) “(d) “(3) A body corporate contravenes subsection (2) if its representa­ tive refuses or fails to appear before the Panel to give evidence, refuses to take an oath or afﬁrmation as a witness, refuses to answer any question, or refuses or fails to provide any docu­ ment or information that the body corporate is required to pro­ vide.

“(4) A person must not act in contravention of any order made by the Panel under section 31X or section 32.
21 s 24 Takeovers Amendment Act 2006 2006 No 48 “(5) Every person who contravenes this section commits an offence and is liable on summary conviction to a ﬁne not exceeding $300,000 and, if the offence is a continuing one, to a further ﬁne not exceeding $10,000 for every day or part of a day dur­ ing which the offence is committed.
“44A Conviction of offence under section 44 excluded in certain cases “(1) A person must not be convicted of an offence under section 44 if, in the opinion of the Court dealing with the case,— “(a) the contravention related to matters that were immate­ rial to the relevant matter before the Panel; or the contravention ought reasonably to be excused, hav­ ing regard to all the circumstances of the case.
“(b) “(2) A director of a body corporate must not be convicted of an offence under section 44 in relation to a contravention by the body corporate if, in the opinion of the Court dealing with the case, the contravention took place without the director’s knowledge and consent.
“False or misleading statement or information “44B False or misleading statement or information “(1) A person must not make a statement or disseminate informa­ tion, in relation to any transaction or event regulated by the takeovers code or incidental or preliminary to a transaction or event that is or is likely to be regulated by the takeovers code, if— “(a) a material aspect of the statement or information is false or the statement or information is materially mislead­ ing; and the statement or information is likely to— “(i) induce a person to trade, or hold, the securities of a speciﬁed company; or “(ii) have the effect of increasing, reducing, maintain­ ing, or stabilising the price for trading in those securities; or “(iii) induce a person to vote for, or to vote against, a transaction that is or is likely to be regulated by “(b) 22 2006 No 48 Takeovers Amendment Act 2006 s 24 the takeovers code, or to abstain from voting in respect of that transaction.
“(2) In this section, trade means to acquire or dispose of securities.

“44C Criminal liability for false or misleading statement or information “(1) A person who contravenes section 44B commits an offence if the person has actual knowledge that the statement or informa­ tion is false in a material aspect or is materially misleading.
“(2) A person who commits an offence against subsection (1) is liable on conviction on indictment to,— “(a) in the case of an individual, imprisonment for a term not exceeding 5 years or a ﬁne not exceeding $300,000, or to both: in the case of a body corporate, a ﬁne not exceeding $1,000,000.
“(b) “44D Exception for disclosure by investment advisers or brokers Section 44B does not apply to conduct in relation to a dis­ closure under Part 4 of the Securities Markets Act 1988 or to conduct in relation to an advice advertisement, a broker ad­ vertisement, or a product advertisement to the extent that that conduct is regulated by Part 4 of that Act.
“44E Fair Trading Act 1986 excluded The Fair Trading Act 1986 does not apply to conduct in re­ lation to any transaction or event regulated by the takeovers code or incidental or preliminary to a transaction or event that is or is likely to be regulated by the takeovers code.
“Subpart 4—Other Court orders “Management bans “44F When Court may make management banning orders The Court may, on application by any person referred to in sec­ tion 35(1)(a) to (g), make a management banning order against a person (A) if— 23 s 24 Takeovers Amendment Act 2006 2006 No 48 “(a) A has been convicted of an offence against either sec­ tion 44 or section 44C or a pecuniary penalty order has been made against A under this Act for a contravention of the takeovers code; or “(b) A has, while a director of an incorporated or unincor­ porated body,— “(i) “(ii) persistently contravened this Act, the Companies Act 1993, the Securities Markets Act 1988, the Securities Act 1978, or the takeovers code; or if the incorporated or unincorporated body has so contravened, persistently failed to take all rea­ sonable steps to obtain compliance with those Acts or the code; or “(c) A has been prohibited in an overseas jurisdiction from carrying on activities that the Court is satisﬁed are sub­ stantially similar to any of the activities referred to in section 44G in connection with a contravention of any law relating to takeovers.
“44G Terms of management banning orders A management banning order may, for a period stated in the order of 10 years or less, prohibit or restrict the person (with­ out the leave of the Court) from being a director or promoter of, or in any way (whether directly or indirectly) being con­ cerned or taking part in the management of, an incorporated or unincorporated body (other than an overseas company, or an incorporated or unincorporated body, that does not carry on business in New Zealand).
“44H Offence of contravening management banning order An individual who acts in contravention of a management ban­ ning order under section 44F commits an offence and is liable on conviction on indictment to imprisonment for a term not exceeding 3 years or to a ﬁne not exceeding $100,000, or to both.
24 2006 No 48 Takeovers Amendment Act 2006 s 24 “44I Only one management banning order may be made for same conduct If conduct by a person constitutes grounds for making an order under any 1 or more of section 44F of this Act, section 60A of the Securities Act 1978, section 43F of the Securities Markets Act 1988, and section 383 of the Companies Act 1993, pro­ ceedings may be brought against that person under any 1 or more of those provisions, but no person is liable to more than 1 order under those provisions for the same conduct.
“44J Persons automatically banned from management “(1) This section applies to a person if the person has been con­ victed of an offence against either section 44 or section 44C or a pecuniary penalty order has been made against the person under this Act for a contravention of the takeovers code.
“(2) The person must not, for the period of 5 years after the convic­ tion or making of the order (without the leave of the Court) be a director or promoter of, or in any way (whether directly or indirectly) be concerned or take part in the management of, an incorporated or unincorporated body (other than an overseas company, or an incorporated or unincorporated body, that does not carry on business in New Zealand).
“(3) An individual who acts in contravention of this section com­ mits an offence and is liable, on conviction on indictment to imprisonment for a term not exceeding 3 years or to a ﬁne not exceeding $100,000, or to both.
“44K General provisions for bans and banning orders “(1) The Registrar of the Court must, as soon as practicable after the making of a management banning order under section 44F,— give notice to the Registrar of Companies and the Panel “(a) that the order has been made; and “(b) give notice in the Gazette of the name of the person against whom the order is made and the period or dates for which the ban applies.
“(2) A person intending to apply for the leave of the Court under section 44G or section 44J must give to the Panel not less than 10 days’ written notice of that person’s intention to apply.

25 s 24 Takeovers Amendment Act 2006 2006 No 48 “(3) The Panel, and any other person that the Court thinks ﬁt, may attend and be heard at the hearing of the application.
“Orders to preserve assets to satisfy claims “44L When Court may prohibit payment or transfer of money, securities, or other property “(1) This section applies if— “(a) “(b) “(c) an investigation is being carried out under this Act in relation to an act or omission by a person, being an act or omission that constitutes or may constitute a contra­ vention of this Act or the takeovers code; or a prosecution has begun against a person for a contra­ vention of this Act; or a civil proceeding has begun against a person under this Act.
“(3) “(2) The Court may, on application by the Panel or by an aggrieved person, make 1 or more of the orders listed in section 44M if the Court considers it necessary or desirable to do so for the purpose of protecting the interests of an aggrieved person.
In this section and section 44M,— “aggrieved person means any person to whom a relevant per­ son is liable “associated persons are— “(a) persons who are relatives within the meaning of the In­ come Tax Act 2004 or de facto partners; or “(b) persons who are partners to whom the Partnership Act “(c) “(d) “(e) 1908 applies; or bodies corporate that consist of substantially the same shareholders or are under the control of the same per­ sons; or a body corporate and a person who has the power, di­ rectly or indirectly, to exercise, or control the exercise of, the right to vote attached to 25% or more of the vot­ ing securities of the body corporate; or a body corporate and a person who is a director or prin­ cipal ofﬁcer of the body corporate 26 2006 No 48 Takeovers Amendment Act 2006 s 24 “liable means liable, or may be or become liable, to pay money (whether in respect of a debt, by way of damages or compensa­ tion, or otherwise) or to account for securities or other property “relevant person means a person referred to in subsection (1).
“Compare: Section 1323(1), Corporations Act 2001 (Aust.)
“44M What orders may be made “(1) The orders that may be made under section 44L are— “(a) “(b) “(c) “(d) “(e) “(f) an order prohibiting the relevant person from transfer­ ring, charging, or otherwise dealing with money, secur­ ities, or other property held or controlled by the relevant person: an order prohibiting a person who is indebted to the rele­ vant person or to an associated person of the relevant person from making a payment in total or partial dis­ charge of the debt to, or to another person at the direc­ tion or request of, the person to whom the debt is owed: an order prohibiting a person holding money, securities, or other property, on behalf of the relevant person, or on behalf of an associated person of the relevant person, from paying all or any of the money, or transferring, or otherwise parting with possession of, the securities or other property, to, or to another person at the direction or request of, the person on whose behalf the money, securities, or other property, is or are held: an order prohibiting the taking or sending out of New Zealand by a person of money of the relevant person or of an associated person of the relevant person: an order prohibiting the taking, sending, or transfer by a person of securities or other property of the relevant person, or of an associated person of the relevant per­ son from a place in New Zealand to a place outside New Zealand (including the transfer of securities from a register in New Zealand to a register outside New Zealand): an order requiring the relevant person, or any person holding money, securities, or other property on behalf of the relevant person or an associated person of the relevant person, to pay or transfer money, securities, 27 s 24 Takeovers Amendment Act 2006 2006 No 48 “(g) or other property to a speciﬁed person to be held on trust pending determination of the investigation, pros­ ecution, or civil proceeding: an order appointing,— “(i) if the relevant person is a natural person, a re­ ceiver or trustee, having any powers that the
 Court orders, of the property or of part of the property of that person; or if the relevant person is a body corporate, a receiver or receiver and manager, having any powers that the Court orders, of the property or of part of the property of that person: “(ii) “(h) “(i) if the relevant person is a natural person, an order re­ quiring that person to deliver up to the Court his or her passport and any other documents that the Court thinks ﬁt: if the relevant person is a natural person, an order pro­ hibiting that person from leaving New Zealand, without the consent of the Court.
“(2) A reference in subsection (1)(e) or (g) to property of a person includes a reference to property that the person holds other­ wise than as sole beneﬁcial owner, for example,— “(a) as trustee for, as nominee for, or otherwise on behalf of or on account of, another person; or in a ﬁduciary capacity.

“(b) “(3) An order may be expressed to operate for a speciﬁed period or until the order is discharged by a further order under this section.
“Compare: Section 1323(1), (2A), (6), Corporations Act 2001 (Aust.)

“44N Interim orders “(1) If an application is made to the Court for an order under section 44L, the Court may, if in the opinion of the Court it is desirable to do so, before considering the application, grant an interim order, being an order of the kind applied for that is expressed to have effect pending the determination of the application.
“(2) The Court must not require the applicant or any other person, as a condition of granting an interim order under this section, to give an undertaking as to damages.

28 2006 No 48 Takeovers Amendment Act 2006 s 24 “(3) In determining an application for the grant of an interim order, the Court must not take into account that the applicant is not required to give an undertaking as to damages.

“Compare: Section 1323(3), (4), Corporations Act 2001 (Aust.)
“44O Relationship with other law “(1) Nothing in sections 44L to 44N affects the powers that the Court has apart from those sections.

“(2) This section has effect subject to the Insolvency Act 1967.

“Compare: Section 1323(7), (8) Corporations Act 2001 (Aust.)
“44P Offence A person commits an offence who contravenes an order by the Court under section 44M or section 44N that is applicable to the person and is liable on conviction on indictment,— “(a) in the case of an individual, to imprisonment to a term not exceeding 3 years or to a ﬁne not exceeding $100,000, or both: in the case of a body corporate, to a ﬁne not exceeding $300,000.

“(b) “Compare: Section 1323(9), (10), Corporations Act 2001 (Aust.)
“Subpart 5—General “44Q Jurisdiction of Courts in New Zealand The High Court has exclusive jurisdiction to hear and deter­ mine proceedings in New Zealand under this Act, other than proceedings for offences against this Act or appeals under sec­ tion 31G.
“44R Court may order payment of Panel’s costs If the Panel brings proceedings under this Part and the Court makes any order against a person under this Part, the Court may also order that person to pay the Panel’s costs and ex­ penses in bringing the proceedings.

29 s 24 Takeovers Amendment Act 2006 2006 No 48 “44S Orders to secure compliance The Court may, for the purpose of securing compliance with any order it makes under this Part, direct a person to do or refrain from doing a speciﬁed act.
“44T Giving notice of applications for Court orders Before making an order under this Part, the Court may direct the person making the application for the order to— “(a) give notice of the application to those persons the Court thinks ﬁt: “(b) publish notice of the application in the manner the Court thinks ﬁt.

“44U General provisions as to Court’s orders “(1) An order under this Part may be made on the terms and con­ ditions the Court thinks ﬁt.
“(2) The Court may revoke, vary, or suspend an order made under this Part on the terms and conditions the Court thinks ﬁt.
“44V Persons entitled to appear before Court The following persons are entitled to appear and be heard at the hearing of an application to the Court under this Part: “(a) “(b) “(c) the applicant: the Panel: if the speciﬁed company’s securities are, or were at the material time, quoted on a registered exchange’s mar­ ket, that registered exchange: the speciﬁed company: a person who is alleged to have suffered, or to be likely to suffer, loss or damage because of an alleged contra­ vention of this Act or the takeovers code (whether that person or another person makes the allegation): a person who was a security holder of the speciﬁed com­ pany at the time that the conduct to which the applica­ tion relates occurred: a person who, at any time within the period of 6 months before the making of the application, has made an offer or offers to acquire securities in the speciﬁed company in accordance with the takeovers code: “(d) “(e) “(f) “(g) 30 2006 No 48 Takeovers Amendment Act 2006 Part 26 s 27 a person directed to be given notice of the application: “(h) “(i) with the leave of the Court, any other person.
“44W Knowledge of matters presumed if employee or agent knows matters In any proceedings under this Act, it is presumed, in the ab­ sence of proof to the contrary established on the balance of probabilities, that a person knew, at a material time, of any matter if, at that time, an employee or agent of that person knew of the matter in his or her capacity as employee or agent.
“44X No pecuniary penalty and ﬁne for same conduct A person cannot be ordered to pay a pecuniary penalty and be liable for a ﬁne under this Act for the same conduct.” 25 New Part 4 heading substituted The heading above section 45 is repealed and the following heading substituted: “Part4 “Miscellaneous”.

26 27 (1) Amendments to takeovers code Takeovers code substituted Sections 27 to 29 amend the Schedule of the Takeovers Code Approval Order 2000.
Interpretation Rule 3(1) is amended by revoking the deﬁnition of code com­ pany and substituting the following deﬁnition: “code company means a company that— “(a) is a party to a listing agreement with a registered exchange and has securities that confer voting rights quoted on the registered exchange’s market; or “(b) was within paragraph (a) at any time during the period of 12 months before a date or the occurrence of an event referred to in this code; or has 50 or more shareholders”.
“(c) 31 Part 26 s 28 Takeovers Amendment Act 2006 2006 No 48 (2) Rule 3(1) is amended by inserting the following deﬁnition in its appropriate alphabetical order: omitting to do an act; or “engaging in conduct means doing or refusing to do an act, and includes,— “(a) “(b) making it known that an act will or will not be done”.
(3) Rule 3 is amended by adding the following subclause: “(3) The deﬁnition of code company in this rule speciﬁes the period of time to be speciﬁed by the code for the purposes of the deﬁnition of speciﬁed company in the Act.” 28 “(4) Offer period Rule 24 is amended by adding the following subclause: If the offer period is extended by the Panel by order made under section 32 of the Act, that additional period is included in the offer period for the purposes of this code.” 29 New Part 8 added The following Part is added after rule 63: “Part8 “Market manipulation “64 Misleading or deceptive conduct “(1) A person must not engage in conduct that is— “(a) conduct in relation to any transaction or event that is regulated by this code; and “(b) misleading or deceptive or likely to mislead or deceive.
“(2) A person must not engage in conduct that is— “(a) incidental or preliminary to a transaction or event that is or is likely to be regulated by this code; and “(b) misleading or deceptive or likely to mislead or deceive.
“65 Exception for disclosure by investment advisers or brokers Rule 64 does not apply to conduct in relation to a disclosure under Part 4 of the Securities Markets Act 1988 or to conduct in relation to an advice advertisement, a broker advertisement, 32 2006 No 48 Takeovers Amendment Act 2006 Part 31 s 31 30 (1) (2) 31 or a product advertisement to the extent that that conduct is regulated by Part 4 of that Act.” Amendments to replace references to takeovers schemes Amendments to replace references to takeovers schemes Section 67C(4) of the Companies Act 1993 is amended by omitting “a takeover scheme under section 4 of the Compan­ ies Amendment Act 1963” and substituting “a takeover offer made under the takeovers code in force under the Takeovers Act 1993”.
Section 26(3) of the Co­operative Companies Act 1996 is amended by omitting “a takeover scheme under section 4 of the Companies Amendment Act 1963” and substituting “a takeover offer made under the takeovers code in force under the Takeovers Act 1993”.
Transitional provisions Transitional provision for acquisitions made or committed to before commencement of this section No amendment made by this Act requires a person to comply with the principal Act or the code— (a) by reason only of the fact that, on the commencement of this section, a particular proportion of securities have been acquired in a speciﬁed company, whether by that person or any other person before the commencement of this section; or by reason of the acquisition of securities in a speciﬁed company, whether by that person or any other person, on or after the commencement of this section, if the acquisition arises from the performance of a contractual obligation incurred, or the exercise of a right acquired, before the commencement of this section.
(b) 33 Part 31 s 32 Takeovers Amendment Act 2006 2006 No 48 32 (1) (2) Transitional provision for existing offences and contraventions The principal Act and the code continue to have effect as if they were not amended by this Act for the purpose of— investigating an existing offence or contravention: (a) commencing or completing proceedings for an existing (b) offence or contravention: imposing a penalty or other remedy, or making an order, in relation to an existing offence or contravention.
In this section, existing offence or contravention means an offence under, or contravention of, the principal Act or the code that was committed or done before the commencement of this Act.

(c) 10 October 2006 12 October 2006 Legislative history Divided from Securities Legislation Bill (Bill 234­2) as Bill 234­3C Third reading 34